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16 September, 03:48

Cost allocation involves: Multiple Choice

Identifying a cost driver for each cost to be allocated.

Calculating an allocation rate for each cost to be allocated.

Multiplying the allocation rate by the weight of the cost driver.

All of the answers are correct.

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Answers (1)
  1. 16 September, 05:27
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    All of the answers are correct

    Explanation:

    The cost allocation refers to the allocation of cost with respect to the cost driver through which the allocation could be done in easily manner

    Moreover, it also used to compute for allocation rate and then it would be multiplied with the weightage of the cost driver

    Here, the cost driver meaning

    The inspection cost is allocated by the number of inspections. Like setup, the cost is allocated by the number of setups required
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